All Forum Posts by: David Albertson

I just got off the phone with my mortgage lady. She told me that she can't do any more mortgages for houses in the county that I've been focusing on. Apparently they sell all of their mortgages to Citibank. Citibank has declared the whole county as a "declining market" and won't buy any mortgages there. Has anybody ever heard of that? Kinda sounds like BS to me. What do you think?

I'm doing a project similar to what you're talking about. I went to a local bank and we determined a construction loan was the way to go. Basically I had to put down 5% of the purchase price and I had to draw up an estimate of the rehab costs. The appraiser looks at the property and takes in to consideration the rehab and comes up with a after-repaired value. The bank then gave me a line of credit that I could draw funds from to pay contractors, home depot cards, etc.. So you will have some money out of pocket but then the bank reimburses you. The only problem is that you will have to refinance when the project is completed so you end up paying some closing costs twice. We're currently doing the refinance and taking cash out to cover the closing costs and repairs on the next one or maybe two. It's just really hard to find a bank that's willing to play. I would suggest calling around to small locally owned banks. The big mortgage companies won't do anything "creative" with investors anymore, from my experience anyways. Also you really need to find a better deal. By the time you pay all the closing costs, appraisals, holding costs, etc., you will find yourself owing what the place is worth. And I'd be willing to bet it won't flow any cash in your direction, probably the opposite will be true.

Wheatie, thanks for the reply. Actually I'm willing to sell for what I have in it just to get out from under it. He talked like he might be able to come up with a little down.

I wonder if there is a way to structure the deal so that he buys the house for $127k, I get the $111k that I owe and he gets cash for the balance?

Anyone? Anyone?

Here's the deal. I have a SFR that I purchased about a year ago with the intention of rehabbing and reselling. We made the typical newbie mistakes and put way too much money in to it. It sat on the market for several months last summer before we finally decided to rent it out. I just had a new tenant move in and he's warming to the idea of purchasing it from us. The house appraised last November for $127k. We have a 1st mortgage of $101k and about $10k from our HELOC on our personal residence.

The tenant claims he would be more interested in buying if he didn't have $15k in credit card debt. I'm wondering if there's a way I could work a deal to help him out with his CC's and get me out from under my newbie mistake.

Any ideas anyone?

Thanks.

Thanks for both of the replies. It wasn't a marketing tactic, it was me opening my big mouth and trying to be a nice guy. I'm learning. Today we signed a cancelation and the new lease, so all is well. Besides I don't think a verbal agreement would hold any water in front of a judge anyways. But, now I know to keep my mouth shut. If it comes up again, I'm keeping the deposit at the very least. Thanks again for the quick replys.

Bartstop

I made a newbie mistake when I rented my house out. I told the tenents that after 6 months if they wanted to move, I would let them out of their lease. Well it's been 6 months and they want out. I have some new tenents lined up and should be signing a lease today. How do I go about canceling the lease I have with the first tenents? Should I just shred the first lease (I have a copy, they have a copy), or should I draw up some type of cancelation form? Also, should I do that before I sign the new lease?

One of my tenants called me today. Back when we signed the 1 year lease I told him that after 6 months if they wanted to move I would be willing to cancel the lease as long as I could find another tenant. I don't want to keep someone in my house if they don't want to be there. Well, today was 6 months, to the day. He calls me up with this big attitude about how he did me a favor by agreeing to move if we sold the place (we've had it on the market for 3 weeks now). We haven't had anybody come to look at the property so now he's pissed and wants to move out by June 1st. I'm really not that worried about him being pissed at me but what has me worried is that they always pay on the first of the month but didn't today. I have a feeling that their plan is to not pay so I will kick them out. I don't think they understand the consequences. When and IF I have to post a "Pay or Quit Notice", is there something I can include that explains what will happen if they don't pay? Don't get me wrong, I'm prepared to go to battle over this but I really would like to avoid it if possible.

PS- I'm currently searching for a new tenant as my other thread states.

I had a lady call me this afternoon from a car dealership. She said that she was looking to rent a house for another employee there. I'm assuming they are moving this guy from out of town because they need the house "yesterday". She told me that the lease would be in the dealerships name and that they would pay for the rent for the couple. My question is, how would I go about this? Obviosly I'm going to do a background check on the couple but who would be signing the lease?

I have a SFR in a low income area. I just received an application (with application fee) from a single mother. The local screening service I use didn't come up with any criminal history, but did come up with one rental judgement from 2001 and one medical judgement from 2002 that has been paid. She also has about $8400 worth of unpaid medical bills that have been placed for collection.

My question is, if I call to verify employment, is it leagal to ask how much her monthly income is? Also, if I were to do a month to month lease and she didn't pay, would I still have to go thru the eviction process to get her out?